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On December 31, 2018, Sunland, Inc. appropriately changed its inventory valuation method to FIFO cost from weighted-average cost for financial statement and income tax purposes.
On December 31, 2018, Sunland, Inc. appropriately changed its inventory valuation method to FIFO cost from weighted-average cost for financial statement and income tax purposes. The change will result in a $3800000 increase in the beginning inventory at January 1, 2018. Assume a 40% income tax rate. The cumulative effect of this accounting change on beginning retained earnings is
$1520000.
$0.
$2280000.
$3800000.
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